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Archive for September 13th, 2017

Asking Questions

Commentary said this yesterday on the possibility of H-Town property owners paying more taxes:

If we are going to have to cough up more dough, you figure there have to be some trade-offs.

What exactly are we short? What exactly are we paying for? For example, if we lost 334 vehicles, what is the replacement cost for 334 vehicles?

And this:

One question I have is have we – folks from H-Town – ever seen our taxes increased to help pay for damages after a major hurricane or storm?

I have not gotten an answer on this.

Bill King is asking the tough questions and raising some points that ought to be discussed. Here is what Bill put out today:

Many Questions Need to be Answered

Before We Raise the City’s Property Taxes

Harvey was an extraordinary event and calls for an extraordinary response.  That response may include raising more revenue for flood projects in our region.  But the proposal by Sylvester Turner for City Council to immediately raise the City’s property taxes by $113 million raises a number of troubling questions.  

First, let’s not kid ourselves that his money is going to be used to stem flooding.  Since 2012, the City has collected about $800 million in “drainage fees.”  A tiny fraction of that money has actually been spent on flood control projects.  Trust me, none of this $113 million will be.  

Under the property tax cap charter amendment, City Council can raise additional property tax revenue over the cap by an amount “necessitated by city expenditures related to the inclusion of the city in any declaration of an emergency or disaster.

Therefore, the threshold question must be:  How is the $113 million going to be spent?  The only explanations we have gotten so far is that the City will have to pony up about $20 million for it share of debris removal expenses, needs to replace about 300 flooded vehicles and repair some unspecified damages to some of the City’s facilities.  But we have a $20 million “rainy day fund” (recently renamed the Budget Stabilization Fund) for exactly this purpose.  And it should not cost more than about $15 million to replace 300 vehicles.  So where is the rest of the money going?  

And were any of those losses covered by insurance?  I found a note in the 2016 Annual Report that appears to suggest that the City is covered for any flood losses over $10 million.  I do not know if that is actually the case or not.  But if we do not have any coverage, why not?  (And for that matter, why were over 300+ vehicles left where they would be flooded in the first place?)    

How much of these expenses will be covered by donations?  Are there alternatives to raising taxes?  Can some of the TIRZ money be tapped?  City reports show there is about a $50 million fund balance in the “dedicated” drainage fund.  Can that be used?

City Council has an obligation under the charter to demand an accounting of what expenses are necessitated by the disaster before voting to suspend the cap.  To do otherwise raises the question of whether this whole exercise is just a pretext to accomplish what the advocates of repealing the property tax cap knew they could not do at the ballot box.  

There are two things that make me suspicious this is just such a pretext.   First, the increase is exactly (to the one-hundredth percent) the amount the tax rate has been decreased because of the property tax cap.  Are we to believe that the city expenditures necessitated by the storm just happen to come out to that exact number?  

Second, Turner’s main surrogate for the repeal of the property tax cap, Council Member Dwight Boykins, made a telling statement.  He told the Houston Chronicle, “Anything to bust that damn rev cap, I’m in.

I think Boykins statement reflects the true opinion of many at City Hall.  They resent that Houston taxpayers have limited the amount that they can increase the property tax and will use any device or excuse to get rid of the cap, including exploiting a natural disaster.

I think it is also noteworthy that no other taxing jurisdiction in our area has proposed increasing taxes in response to Harvey.  The County and HISD both had more severe damages to their facilities, as did several of our sister cities on a relative basis.  Why is the City of Houston the only jurisdiction that needs to immediately raise its taxes?  

There could also be an unintended consequence from a tax increase.  It could spark a taxpayer backlash that will show up at the polls in the November for the City’s bond election.  My guess is that the improvement bonds are already in trouble since they have no money for streets or drainage.  But this could also imperil the passage of the pension bonds, which have, at least to now, enjoyed a comfortable margin of support.  The additional revenue from this tax increase will pale in comparison to the costs if the City is forced to go back to the drawing board on pensions.  

Many in this City are hurting right now.  True, the proposed tax increase will not make a significant difference to most.  But the optics of the City piling on to their misfortune are ugly and will do much to unravel the unity we have found through this ordeal. 

And it is $113 million that the City Council will decide how to spend instead of taxpayers.  That is $113 million less for Houstonians to repair damaged homes, replace flooded items and give to charities.  

Every tax dollar is a precious trust and especially so under these circumstances.  There may be a case for the City increasing taxes.  But that case has yet to be made.

Kuffer kind of hints at what the tax increase will be used for here:

The point here is that the city has some big unexpected bills to pay. It has to pay for a lot of overtime for police officers and firefighters who were rescuing people during the floods and who are dealing with aftereffects like traffic control. It has to pay for a lot of overtime to Solid Waste employees who are working to pick up the enormous piles of trash around the city. Your taxes are going up by a couple hundred bucks to pay for this. If you have a problem with that, I don’t know what to tell you, other than I can’t abide that kind of thinking.

Here is all of Kuffer: http://offthekuff.com/wp/?p=82439.

The Chron E-Board today supports the tax increase without asking the tough questions. Here is a part:

We support – and hope you will, too – Mayor Sylvester Turner’s proposed temporary property tax increase. Houston will receive a sizable amount of state and federal relief funding. The city’s insurance policies will eventually pay out. But it is incumbent on all Houstonians to contribute to the recovery effort, even if it means a higher tax bill in 2018.

Nobody particularly enjoys paying taxes, and we sympathize with homeowners who feel the mayor’s proposal adds insult to injury. We especially feel for those facing the prospect of paying more taxes for flooded homes that are suddenly worth a lot less.

Here is the entire read: http://www.houstonchronicle.com/opinion/editorials/article/Generating-flood-funds-12192873.php.

Bill makes good points.  So does Kuffer, but specifics, please. Just lay out what we have to pay for. It is pretty simple if you ask me.

I need to talk to James to see if Pasadena is raising taxes.

Baytown is back to curbside recycling so I guess they won’t see a tax increase.

HISD suffered $700 million in damages. I wonder if they will raise taxes.

Hunker Down hasn’t signaled a tax increase.

Stay tuned.

We still have 18 games to play and they already released next season’s schedule. Here is from Tags:

HOUSTON — The Astros will open the 2018 season on the road March 29 against American League West foe Texas, marking the second time in club history they open the season against their Lone Star State rivals. Major League Baseball released the 2018 schedule on Tuesday.

The 2018 season will be the first under the new scheduling format agreed to as part of the 2017-2021 Basic Agreement between MLB and the Major League Baseball Players Association (MLBPA). The new format extends the length of the season by adding an additional weekend of play at the beginning of the season.

And:

The March 29 start date will mark the earliest Opening Day in Major League history, excluding special season openers at international venues.

The Astros, who have won five consecutive games on Opening Day, will play the Rangers 19 times next year, but none in the final two months of the season. When the Rangers visit Minute Maid Park July 27-29, it will be the final meeting of the season between the teams.

And:

Houston’s longest road trip is 10 games through Texas (June 7-10), Oakland (June 12-14) and Kansas City (June 15-17). Its longest homestand is 11 games, when the White Sox (July 5-8), A’s (July 9-12) and Tigers (July 13-15) come to Minute Maid Park.

Interleague Play will include matchups against all five NL West clubs, four of which will be at home: the Padres (April 6-8), Giants (May 22-23), Rockies (August 14-15) and D-backs (Sept. 14-16). The Astros will travel to the D-backs (May 4-6), Rockies (July 24-25), Dodgers (Aug. 3-5) and Giants (Aug. 6-7).

We won last night and are 87-57.

 

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